Is life coaching a scam 1

Magical powers as a contractual service: No entitlement to payment for the business with hope

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by Prof. Dr. Hanns Prütting

13.01.2011

Fortune tellers and fortune tellers are booming, especially people in difficult situations make use of their services and pay a lot of money for it. They would not need that: According to the BGH, there is no payment for supposedly magical activities - unless the parties have agreed otherwise. Prof. Dr. Hanns Prütting only considers the result to be correct.

Whether on television, on the Internet or on the street: people with (supposedly) magical abilities offer their services for a fee and promise to solve problems through fortune telling, card reading, asterisks, horoscopes, looking at glass balls and in many other ways. What can be fun for little money at the fair often becomes the last hope for people in difficult life situations. And they are willing to pay for them.

This is also the case in the case that the Federal Court of Justice (BGH) now had to decide on. The plaintiff had offered life counseling through card reading (life coaching) on ​​the Internet. The current defendant suffered from extreme lovesickness after breaking up with his girlfriend and was in a real life crisis. For her work in 2008 he already paid approx. 35,000 euros to the plaintiff, for services in 2009 she now demanded another almost 7,000 euros in court.

But are such fortune tellers even entitled to a fee? Can you sue it in state courts? Are such services not punishable, immoral or is the payment not enforceable because of the promise of an impossible service?

The BGH assumes an impossible achievement

These are the questions that the III. Civil Senate of the BGH in its decision of January 13, 2011. The lower courts (Regional Court and Higher Regional Court of Stuttgart) had already refused the customer's obligation to pay a card reader and therefore invoked the impossibility of the promised service.

The BGH agreed with this view that the performance was impossible (Az. III ZR 87/10). He considers it possible, however, that the parties waive the consequence of § 326 BGB (no obligation to pay).

The Higher Regional Court must now clarify this question and examine the immorality again.

The business with hope - service or work contract?

The legal situation is of course more complex than the result corresponding to the sense of justice suggests. It starts with the conclusion of the contract, which in such cases is often unclear. In this specific case, the Stuttgart courts affirmed that the contract had been tacitly concluded.

The content of the contract was probably the card reading as such, based on this an interpretation of the future should take place, which in turn should be the basis for general life counseling. After all, at least that is what the customer now claimed, the fortune-teller had promised the certain occurrence of the predicted future events.

Apparently a mixture of pure services and announcements of success was promised. The success of a contract in the sense of a contract for work and services (§ 631 German Civil Code (BGB)) presupposes that the entrepreneur influences the success (cf. § 632 Paragraph 1 BGB "Production of the work"). An occurrence of events that is only predicted without the involvement of the entrepreneur is therefore not the subject of a work contract, but can only be one of a service contract.

It hits the weak: exploiting a predicament

How is the demand for payment for such services to be assessed? Some lower courts assumed that such contracts were null and void because they violated a legal prohibition (§ 134 BGB with § 263 StGB). However, the possible criminal offense as such was not the subject of the treaty here. The possible fraud is a consequence of the activity of reading cards, not the content of the contract. Therefore, § 134 BGB is ruled out.

Rather, it is obvious that the contract should be null and void due to usury (Section 138 (2) BGB). People who use such services are often emotionally unstable, and in many cases a predicament is exploited. This is also the case in the case decided by the BGH, in which the defendant was in an apparently emotionally helpless situation due to severe lovesickness, which the card reader had taken advantage of.

Usury: When the price of hope is too high

Whether there is the (objectively) conspicuous disproportion between performance and consideration that is characteristic of the offense of usury, however, is a question of the individual case: What is the market value, what is the usual market remuneration for fortune-telling and future interpretation?

As is well known, offers are available at fairs or on the Internet from one euro. In general, the market value of magical services is unlikely to be measurable. However, the time required for the life counseling promised in this context can be measured. Here one can see the remuneration for an hour with 50 to 100 euros as completely out of proportion to an effort in life counseling.

In the specific case, an hourly fee of 200 euros was charged for coaching, and 100 to 150 euros each for map reading, whereby the card reading probably corresponds to a time expenditure of 5 - 10 minutes. The fortune teller herself admitted that the services she provided by reading cards comprised at least 85 percent of all services. A noticeable disproportion between performance and consideration can therefore be answered in the affirmative.

Card reading and life counseling: Neither impossible nor immoral

However, the lower courts have so far assumed that contracts of fortune tellers and card readers are null and void due to immorality (Section 138 of the German Civil Code) or are aimed at an impossible performance.

If a contract is aimed at an impossible performance, there is no obligation to provide consideration (§§ 275, 326 BGB). The disappointed customer does not have to pay, according to the courts, because the fortune-teller cannot provide the service he has promised anyway, because this is objectively impossible, unless this consequence is waived in individual cases (according to the BGH).

But what exactly should be objectively impossible? A precise distinction must be made between the various services offered. The offer of card reading as such is neither impossible nor immoral. Even the life counseling based on this is by no means impossible when viewed in isolation or immoral from the outset. Ultimately, one can also regard the attempt to interpret the future as possible and not immoral.

"Great love will come" - an impossible promise?

But the fortune teller promises that the pension will be paid out, the son will be well again, and that great love will come along. It thus announces the occurrence of a success or claims that its interpretation of the future corresponds to the actual future occurrence. It cannot guarantee this success. So she is not allowed to give a contractual guarantee that she will bring it about through her work. That would be a promise to an impossible achievement. It is different, however, if this future success is only promised as a possible consequence.

It is not necessary to answer the question of whether it is simply not objectively possible to foresee the future. Because the alleged occurrence of success relates to the general future development of life events and not to the specific services of the fortune teller. From this point of view alone, one cannot assume that the performance is objectively impossible.

The pretense of success (if it is to be answered in the affirmative in individual cases) should rather be seen as an act of deception in the sense of fraud.

Entertainment or last hope: it all depends on the price

Life counseling by reading cards is therefore not generally immoral and not impossible per se. In individual cases, however, it can be usurious or fraudulent.

The decisive factor for the legal assessment is therefore the price charged by the fortune teller. Fortune telling for 1.50 euros at the fair or on the Internet can be interpreted in such a way that the content of the performance is amusement and entertainment. Such a contract is certainly permissible and the promised performance is possible.

If, on the other hand, an amount of 35,000 euros is required and paid for fortune telling, then the interpretation shows that such an amount is only paid if a serious success is expected.

However, since it should also be clear to the respective customer of fortune tellers that the hoped-for success is not based on direct action by the fortune teller, neither the classification of the performance as impossible nor a general verdict of immorality fit in all of these cases.

The constitution also does not allow fraudulent conduct

Insofar as the fortune teller as the plaintiff in the present case had substantiated her claim to payment with the constitutional guarantee of freedom of contract, freedom of ideological belief and freedom of occupation, this is of no importance.

None of the constitutionally named guarantees allow a fortune teller to act fraudulently or harm customers through usurious contractual terms. The same would apply if a fortune teller tried to circumvent legal consequences through contractual agreements or even through general terms and conditions.

The legal consequence of a usurious business is the nullity of the service contract. The services provided on the basis of this now void contract then took place without any legal reason.

The customer sued by the fortune teller can therefore not only refuse payment in accordance with § 821 BGB. According to Section 812 of the German Civil Code (BGB), he can also demand everything he has paid to the fortune teller. Hopefully she put the money on the high edge. You should have known.

The author Prof. Dr. Hanns Prütting holds the chair for German and foreign civil procedure law at the University of Cologne. Among other things, he is director of the Institute for Procedural Law, co-director of the Institute for Legal Law and the author of numerous publications.